Harmonizing the federal and provincial sales tax that was proposed by the Ontario government in its budget Thursday could cost the average family $3,000 per year, according to Simcoe-Grey MPP Jim Wilson.
The proposed budget gives Ontario a $3.9 billion deficit for 2008-2009 and a $14.1 billion in 2009-2010. It also projects the next balanced budget in Ontario will be 2015-2016.
Wilson said it’s not the right time to be merging the provincial and federal sales tax, which would create on 13 per cent sales tax.
There are some exemptions from the new tax, such as children’s clothing and car seats, and new homes under $400,000. But fast food under meals under $4, haircuts and gasoline are among the items and services that will cost more with a harmonized tax.
To help people adjust to the taxes, a tax relief will be handed out over three years to low and middle-income people. Families with an income less than $160,000 would get three payments of $1,000. Single people with an income less than $80,000 would get three payments of $300. The payments would be made in June 2010, December 2010 and June 2011.
Wilson noted that the final payment comes right before the next provincial election.
"People will see through the fact that he’s trying to bribe us with our own money," said Wilson.
The sales tax isn’t the only thing not sitting well with Wilson. Aside from a corporate tax cut, which has the rates going from 14 per cent to 10 per cent by 2013, there is little that satisfies Wilson in the budget.
For Simcoe-Grey, Wilson said there is no commitment to create more long-term care beds, nor is there help for hospital expansions.
The budget allows for some tax relief in manufacturing industry as a whole, but a provincial tax holiday Wilson and the Progressive Conservative caucus are pushing for on new car sales is absent.
Wilson told The Sun before the budget that a tax holiday on new vehicles could help get cars off the dealerships lots and make room for more, which would help workers on the manufacturing factories.
Wilson said a similar provincial tax holiday on accommodations would help promote tourism destinations like the Nottawasaga Inn Resort in Alliston or Blue Mountain in the north end of the riding.
The budget does include infrastructure money, with $32.5 billion set aside for projects in the next two years.
Wilson said there is no proof that anything has been done to remove the provincial red tape that holds up the infrastructure projects when municipalities try to get the work done.
Other highlights of the budget include:
• $32.5 billion for infrastructure projects over the next two years.
• $1.2 billion to renovate 50,000 social housing units and build 4,500 new affordable housing units for low-income seniors and people with disabilities.
• $400 million more in children’s benefits over the next three years. Low and middle-income families will receive up to $1,100 annually per child in Ontario Child Benefit payments starting in July.
• $700 million over the next two years for new skills training and literacy initiatives, including enhancements to existing programs.
• $4.5 billion in business tax cuts over three years.